Transport for London Budget 2020/21

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Transport for London Budget 2020/21
Transport for London
Budget 2020/21
Transport for London Budget 2020/21
Contents

3    How we measure success                    36 Our services
4    Commissioner’s foreword                   37   Streets, buses and other surface operations
5    Chief Finance Officer’s foreword          44   London Underground
6    Measuring success                         49   Elizabeth Line
                                               52   Rail
                                               56   Property
7    Delivering a balanced budget              59   Media
8    Budget at a glance                        61   Commercial Consulting and International Operations
9    Financial summary
12   Meeting our challenges
16   Managing our risks                        63 Appendices
18   Debt and cash                             64   Financial tables
19   Financial trends                          67   Capital Investment
20   Efficiency trends                         69   Budget Milestones
21   Assets and investment priorities

                                               70 About Transport for London (TfL)
23 Delivering the Mayor’s Transport Strategy
24   Healthy streets and healthy people
29   A good public transport experience
33   New homes and jobs

                                                                                                         Transport for London Budget 2020/21    2
Transport for London Budget 2020/21
How we measure
success
Our ambitious targets are measured against
the three key themes of the Mayor’s Transport
Strategy, which are Healthy Streets and healthy
people, a good public transport experience, and
new homes and jobs
Transport for London Budget 2020/21
Commissioner’s foreword

                       This year sees the 2020 Mayoral and London      the Circle, District, Hammersmith & City
                       Assembly elections taking place. There will     and Metropolitan lines, and beginning           ‘We need long-term
                       also be a new Transport Commissioner to         testing of trains on the Northern Line
                       oversee the running of TfL as I move on         Extension to Nine Elms and Battersea
                                                                                                                        funding certainty from the
                       after nearly five years in the role. There      Power Station. Work will continue on the         Government to support a
                       will, however, be no let-up in what we will     massive reconstruction of Bank/Monument          pipeline of vital work that
                       deliver for London. This Budget sets out        station in the heart of the City of London.
                       how we will maintain a safe, reliable and       In addition, the north and south viaducts of     will improve connectivity,
                       efficient transport network for London.         the 4.5km London Overground extension            attract business and
                       Building on our five-year Business Plan,        to Barking Riverside will be completed,
                       this report is fully aligned with the Mayor’s   marking a key stage in this project that will    support new homes’
                       Transport Strategy and will continue to         help unlock 10,800 new homes in the area.
                       encourage more people to walk, cycle and
                       use public transport.                           We will also see major progress on our
                                                                       Healthy Streets agenda. We have already         safety and reliability of day-to-day services,
                       Safety remains our top priority and we will     achieved our target of tripling the amount      improve connectivity, attract business and
                       accelerate work to achieve our Vision Zero      of protected cycle lanes since 2016, months     support new homes. This would also help
                       ambition to eliminate deaths and serious        earlier than expected, and will continue to     create jobs and improve skills across the
                       injury on London’s transport network by         make major improvements to some of the          country. These benefits are not a zero-sum
                       2041. We have recently introduced a 20mph       most dangerous junctions in London, such        game and central Government must invest
                       speed limit on all our roads within the         as Old Street Roundabout. This year, work       in both London and the rest of the country.
                       Congestion Charge zone, mirroring the           to transform the roads around Waterloo          The Capital will become more prosperous
Mike Brown MVO         lower speed limits already in place on most     will begin, making it safer for cyclists,       and attractive if the economies of the rest
Commissioner           borough roads in central London.                improving crossings and bus interchanges,       of the UK nations, regions and cities are
Transport for London                                                   and transforming the public space.              enhanced, and vice versa.
                       We will continue to lead the way in cleaning
                       London’s air and making the Capital a           These improvements are being                    I am confident that whoever leads the
                       greener place to live. In October 2020, we      delivered despite an uncertain economic         organisation through the next period
                       will introduce tougher Low Emission Zone        environment. We receive around 40 per           will continue the good progress we have
                       standards for heavy diesel vehicles. Those      cent less overall funding than we did in        made to improve safety, deliver a reliable
                       vehicles that fail to meet the new standards    2010/11, which is a reduction of around         network and work to unlock the housing
                       will pay a daily charge. We will introduce      £1.4bn each year. We must also bear the         and sustainable growth London needs. I
                       more zero-emission buses, aiming for up         costs of the ongoing delays to the opening      am confident we are in a positive place to
                       to 500 in the fleet by the end of 2020/21,      of the Elizabeth line, with the GLA, despite    respond to the challenges ahead.
                       and complete the installation of 300 rapid      this being a jointly sponsored project with
                       charging points for electric vehicles.          the Government. To combat this, we have
                                                                       applied control on our finances, reducing
                       An additional 11 London Underground             our net deficit, on a like-for-like basis, by
                       stations will become step-free, meaning         more than £1bn since 2015/16, improving
                       a third of the Tube network will be fully       efficiency and suspending non-essential
                       accessible. We will also reach major            work. However, we need long-term funding
                       milestones in projects to upgrade the Tube,     certainty from the Government to support
                       including implementing new signalling on        a pipeline of vital work that will maintain

                                                                                                                              Transport for London Budget 2020/21    4
Transport for London Budget 2020/21
Chief Finance Officer’s foreword

                        Our latest Business Plan, published in             management to navigate volatility in
                        December 2019, set out our response to             passenger demand and uncertainty in the         ‘It is crucial that we secure
                        the challenges we face from a continued            macroeconomic environment.
                        subdued economy, uncertainty around
                                                                                                                            long-term funding certainty
                        the final terms of the UK’s exit from the          This Budget builds on the strong                 in the forthcoming
                        European Union and the delays to the               operational performance in 2019/20.              spending review’
                        opening of the Elizabeth line.                     Passenger income trends continue to be
                                                                           unpredictable. Demand across all our
                        Our funding settlement is confirmed                modes was better than anticipated in the
                        for 2020/21, but we have no certainty of           first half of 2019/20, however we saw a         than 3,000 roles. We are committed to
                        Government funding beyond this financial           sharp deterioration in demand towards           continually improving, adapting to the
                        year. As we explained when we published            the end of 2019, which was consistent with      external headwinds and building resilience
                        our Business Plan, it is crucial that we           a poor Christmas retail performance on          to weather the challenges we face.
                        secure long-term funding certainty in the          the high street. These trends improved
                        forthcoming spending review. We published          in January, but we still remain cautious        The 2019 Business Plan took a pragmatic
                        our 20-year Capital Strategy alongside the         and our projections for 2020/21 reflect         view of our investment programme,
                        Business Plan, which describes London’s            the lowest point of the range of possible       prioritising work that is critical to
                        transport infrastructure requirements. We          outcomes, as informed by forecasts from         maintaining current levels of safety
                        are at the end of a 20-year funding cycle          GLA Economics.                                  and reliability, or those that are already
                        having completed or started upgrades                                                               contractually committed. We have also
                        to the Circle, District, Hammersmith &             We launched the Ultra Low Emission Zone         taken into account delivery realities, which
                        City, Jubilee, Metropolitan, Northern and          in April 2019, which resulted in a fall in      are sometimes subject to factors outside
Simon Kilonback         Victoria lines, but have no future funding         roadside nitrogen dioxide pollution by 36       of our control. As part of this budgeting
Chief Finance Officer   certainty for the next round of upgrades.          per cent in the zone in the first six months,   round, I challenged the business to arrive at
Transport for London    We are working closely with Government             compared to 2017 levels. Compliance rates       a financial budget that we can deliver which
                        and stakeholders to secure the funding             are higher than we anticipated, which is        takes into account historical delivery rates,
                        to continue investing in the transport             positive for the environment. We have           adjusted as appropriate for each area.
                        infrastructure London needs. This is critical      reduced our income projections for 2020/21
                        for London and also to enable our supply           to reflect this. We started rolling out new     In 2020/21, total investment in both
                        chain to plan for the future and deliver           trains on the London Overground, which          capital renewals and new capital will
                        the improvements needed to keep London             is planned to complete in summer 2020.          increase from £1,562m to £1,866m. This
                        competitive on a global stage, support             These new trains will result in higher          is a challenging but realistic Budget that
                        investment across the country and be               operating costs in the short term, which        maintains significant levels of investment
                        a place where people can travel safely,            are reflected in this Budget. We completed      in London. The key external risk to financial
                        reliably, affordably and easily.                   the planned changes to our bus network          delivery in 2020/21 remains passenger
                                                                           in central London in 2019 and continue          income volatility, underpinned by a very
                        We have a strong track record of delivering        to work hard to mitigate the impact of          uncertain macroeconomic environment.
                        our financial strategy, having reduced our         inflationary cost increases.                    However, we have demonstrated that
                        net deficit, as measured by the net cost                                                           we can successfully manage risks, while
                        of operations, by more than £1bn since             Since late 2018/19, we have taken a decisive    maintaining financial discipline and building
                        2015/16 on a like-for-like basis. In 2019/20, we   step towards a leaner and more efficient        resilience. I am confident we will continue
                        have seen the deficit improve for the fifth        back-office organisation, having worked         to deliver for the people who live and work
                        consecutive year, which is testament to            in consultation with our trade unions           in London.
                        our firm grip on cost and careful business         to review 25 business areas and more

                                                                                                                                 Transport for London Budget 2020/21    5
Transport for London Budget 2020/21
Measuring success
                                                              Our scorecard provides a clear line of sight
                                                              between the Mayor’s Transport Strategy, our
                                                              five-year Business Plan and annual Budget

                                                              Our scorecard is aligned to the three key       investment programme. The risks around
                                                              themes of the Mayor’s Transport Strategy        capital delivery are described on pages 16
                                                              – Healthy Streets and healthy people, a         and 17, and we will continue to improve
                                                              good public transport experience and            the accuracy of these forecasts. We have
                                                              new homes and jobs. It is balanced across       started to see a reduction to the additional
                                                              four quadrants – Safety and operations,         time it takes to make a step-free journey
                                                              Customer, People and Financial – with each      compared to last year as a result of the
                                                              carrying a weight of 25 per cent.               investment in accessibility, however, we
                                                                                                              missed our target largely due to the delays
                                                              The TfL Board approves the measures             in the Crossrail construction programme.
                                                              we use to track performance against key
                                                              priorities and outcomes, and we report the      We have improved the total workforce
                                                              results at each Board meeting.                  engagement and inclusion index and expect
                                                                                                              to have improved workforce diversity. We
                                                              Our forecast results for 2019/20 show           also expect the percentage of people who
                                                              safety must remain our critical focus. If we    agree we care about our customers to meet
                                                              are to achieve our Vision Zero objective of     the target.
                                                              having nobody killed or seriously injured on
                                                              our roads by 2041, then we must meet the        Our 2020/21 scorecard will be developed
                                                              target each year. In 2019, we saw a reduction   based on new priorities and key metrics to
                                                              in the number of people killed or seriously     measure our performance in light of recent
                                                              injured by buses beyond the trajectory          unfolding events.
                                                              to achieve Vision Zero. We must now see
                                                              this across the whole transport network,
                                                              including on our roads and among our
                                                              customers and workforce.

                                                              In 2019/20, we increased the number of
                                                              Euro VI compliant buses and have seen an
                                                              improvement in bus reliability. We expect
                                                              to achieve our financial target for a net
                                                              operating surplus, but revised timings
                                                              on the delivery of projects means we
                                                              will not meet our revised target for the

We are set challenging targets to achieve our key ambitions                                                         Transport for London Budget 2020/21     6
Transport for London Budget 2020/21
Delivering a
balanced budget
This Budget is balanced against a series of factors
and risks, including passenger demand, lifespan of
our assets and the evolving political landscape
Transport for London Budget 2020/21
Budget at a glance
Keeping London moving, working and growing to make life in our city better

How we report on our business                                                                     Total sources and uses of funds

Streets, buses and other surface operations
                                                               985             trains on the
                                                                               TfL network
                                                                                                  £9.7bn
                                                                                                  Total sources of funds
Transport for London Road Network, London Buses, London
Dial-a-Ride, London River Services, London Taxi and Private                                                                    Use of
                                                                                                                               borrowing,
Hire, Santander Cycles, Victoria Coach Station and Emirates                                                                    working                                                   Crossrail
Air Line                                                                                                                       capital                                                   funding
                                                                                                                               and cash       Other                 Passenger            (including
                                                                                                            Grants             reserves       income                income               borrowing)
                                                                                                            £2.0bn             £0.6bn         £1.2bn                £5.1bn               £0.8bn
Underground
London Underground
                                                                          300
                                                                          rapid charging points
                                                                          by the end of 2020
Elizabeth line
Currently operating as TfL Rail

                                                               755km                              79%
Rail                                                           TfL-operated Rail and London
                                                               Underground routes
                                                                                                  spent on running
                                                                                                  and operating the
DLR, London Overground and London Trams                                                           network every day

                                                                                                                                                                                            21%
Property                                                                                                                                                                           spent renewing

                                                                       9,000+
                                                                                                                                                                                and improving the
Our commercial and residential estate and building portfolio                                                                                                                      network through
                                                                                                                                                                                 one of the largest
                                                                                                                                                                                capital investment

Media
                                                                       buses across our
                                                                       network, all of which
                                                                       will meet the Euro VI
                                                                       engine standard by the
                                                                                                  £9.7bn
                                                                                                  Total uses of funds
                                                                                                                                                                                      programmes
                                                                                                                                                                                          in Europe

Advertising estate and digital marketing infrastructure
                                                                       end of 2020

Commercial consulting
and international operations
Our global consultancy operation and brand licensing
                                                               6,300
                                                               traffic signals that
                                                                                                          New capital
                                                                                                          investment
                                                                                                                             Capital
                                                                                                                             renewals
                                                                                                                                            Operating
                                                                                                                                            costs                  Financing
                                                                                                                                                                                        Crossrail
                                                                                                                                                                                        programme
                                                                                                          £1.3bn             £0.5bn         £6.6bn                 £0.6bn               £0.7bn
                                                               we operate

                                                                                                                                                        Transport for London Budget 2020/21      8
Transport for London Budget 2020/21
Financial summary
                                                                         Despite the challenges, we are on track to
                                                                         achieve operational breakeven by 2022/23
                                                                         through stronger cost management

                                                                         Operating account
                                                                         We start 2020/21 in a challenging position compared to our 2019
                                                                         Business Plan. We have seen a fall in passenger demand in the
                                                                         latter part of 2019/20, which we expect to continue into 2020/21. Our
                                                                         budgeted net cost of operations is now £571m, which is an increase of
                                                                         £78m against the Business Plan.

                                                                                                                                                                                 2020/21
                                                                                                                                   2020/21     Variance to                      variance
                                                                                                                    2020/21       Business       Business         2019/20     to 2019/20
                                                                         TfL Group (£m)                             Budget            Plan            Plan       forecast       forecast

                                                                         Passenger income                                5,063        5,123            (60)         4,952                111
                                                                         Other operating income                          1,006       1,045             (39)          1,020             (14)
                                                                         Total operating income                         6,069        6,168             (99)          5,972              97
                                                                         Business Rates Retention                         969          968                1           988               (19)
                                                                         Other revenue grants                                17          11              6             113             (96)
                                                                         Total income                                    7,055       7,147             (92)         7,073              (18)
                                                                         Operating cost                                 (6,625)     (6,618)             (7)        (6,344)            (281)
                                                                         Net operating surplus                            430          529             (99)           729             (299)
                                                                         Net financing costs                             (468)       (487)               19          (448)             (20)
                                                                         Net surplus/(cost) of operations
                                                                                                                          (38)          42             (80)            281            (319)
                                                                         before renewals
                                                                         Capital renewals                                (533)        (535)              2           (484)             (49)
                                                                         Net cost of operations                           (571)      (493)             (78)          (203)            (368)

                                                                         Passenger income                                          We saw better than expected demand in
                                                                         The passenger income budget in 2020/21                    the first half of 2019/20 across all modes,
                                                                         is £5,063m, a decrease of £60m compared                   but demand fell towards the end of 2019.
                                                                         to our 2019 Business Plan. This reflects the              Although demand has shown some signs
                                                                         volatility of passenger journey trends.                   of recovery since January 2020, we remain
                                                                                                                                   cautious and our forecast for 2020/21
                                                                                                                                   reflects this.

Passenger number assumptions have been revised since our Business Plan                                                                        Transport for London Budget 2020/21         9
Transport for London Budget 2020/21
Movement on net cost of operations (£m)                                                                              Movement on operating costs (£m)

   0                                                                                                                 (5,000)

                             111
(100)
                                          (14)                                                                       (5,400)

             (203)
(200)

                                                        (115)                                                        (5,800)

(300)

                                                                                                                     (6,200)
                                                                                                                                (6,344)
(400)

                                                                                                                                                                                59                                                      (6,625)
                                                                                                                     (6,600)                      (173)                                                                    193
(500)
                                                                                                                                                                    (121)
                                                                      (281)                                                                                                                  (128)
                                                                                                            (571)
                                                                                  (49)                                                                                                                        (111)
                                                                                               (20)
(600)                                                                                                                (7,000)
            2019/20       Passenger      Other     Business rates   Operating    Capital   Net financing   2020/21              2019/20       Growth and          Inflation   Projects   Restructuring      Other cost    Savings      2020/21
            forecast       income      operating     and other        costs     renewals       costs       Budget               forecast     new initiatives                                  and         increases and                Budget
                                        income     revenue grants                                                                                                                         exceptional        one offs
                                                                                                                                                                                             costs

        Forecast/Budget               Favourable movement               Adverse movement                                   Forecast/Budget                     Favourable movement            Adverse movement

Other operating income                                              There is a £39m decrease in other operating      Business rates and other revenue grants                             Operating costs
This includes the Congestion Charge,                                income since the 2019 Business Plan. This        These decrease by £115m compared to the                             Budgeted operating costs for 2020/21 are
enforcement income and revenue                                      follows a fall in the number of vehicles         2019/20 forecast. This is largely due to one-                       £6,625m, which is in line with the 2019
generated through commercial activities,                            entering the Congestion Charging zone and        off funding received as part of the 2019/20                         Business Plan. We are mitigating inflationary
such as advertising, property rental and our                        higher than expected ULEZ compliance             Budget, including an additional £83m over                           pressures through our savings programme.
newly launched consultancy arm. In April                            rates, which has environmental benefits.         two years from the GLA to fund Mayoral                              However, total year-on-year operating costs
2019, we also introduced the new Ultra Low                          However, year on year, we are mitigating         priorities, with £60m received in 2019/20.                          are increasing by £281m in 2020/21 from a
Emission Zone (ULEZ).                                               some of this by growing our commercial           We also received £34m in 2019/20 to cover                           combination of new services, one-time
                                                                    income through upgrading our estate and          the initial implementation costs of the bus                         costs and restructuring cost increases as
                                                                    opening new retail units.                        driver retention scheme. These receipts will                        explained in the graph above.
                                                                                                                     not be repeated in 2020/21.

                                                                                                                                                                                                     Transport for London Budget 2020/21         10
These costs feature £173m from the             Capital expenditure                            Capital account (£m)
introduction of new services, including        This Budget reflects the latest project
testing and preparations for the opening       schedules, with some timing differences to
                                                                                                                                                                                               2020/21
of the Elizabeth line (£110m), new higher      our Business Plan following a zero-based                                                          2020/21     Variance to                      variance
capacity trains on London Overground           review of our major programmes. Our new                                               2020/21    Business       Business         2019/20     to 2019/20
and the introduction of the Direct Vision      capital investment in 2020/21 is £1,333m,      TfL Group                              Budget         Plan            Plan       forecast       forecast
Standard – to improve safety of all road       which is a reduction of £213m against the
                                                                                              New capital investment                  (1,333)     (1,546)             213         (1,078)           (255)
users, including pedestrians, cyclists and     Business Plan.
motorcyclists – from October 2020.                                                            Crossrail investment programme           (725)        (626)            (99)         (1,039)             314
                                               We have updated our assumptions on             Total capital investment               (2,058)      (2,172)             114         (2,117)              59
There will be a £128m increase from            Crossrail capital spend and funding, in
restructuring and exceptional costs. This      line with the latest profile confirmed by      Funded by:
is largely driven by a higher contingency,     Crossrail Limited.                               Mayoral business rates                   910         910                -           893                 17
to ensure we have an operational buffer
                                                                                                Property receipts and asset sales        153         172              (19)           164               (11)
against unforeseeable events, and              Managing cash flow
costs to support London Underground            To support our financial resilience, we must     Borrowing                              1,333        1,352             (19)          544              789
modernisation savings.                         protect our liquidity. We are maintaining        Crossrail funding sources                114          112               2           1,031            (917)
                                               a minimum cash reserve equivalent to
Inflation accounts for a cost pressure         at least two months of our operating             Other capital grants                     123         173             (50)           205              (82)
of £121m, from contract inflation across       expenses. This is a prudent cash position,     Total                                    2,633       2,719             (86)         2,837             (204)
operators and suppliers, with approximately    which enables us to respond to unexpected
                                                                                              Net capital account                       575         547                28           720             (145)
£50m on bus operators’ contract costs,         shocks, such as a recession, and any further
increased energy prices and wage inflation.    risk against Crossrail timescales.
We will see a £111m increase in other spend,
including higher pension contributions,        We need to build up our cash reserves
offset by lower project spend of £59m.         to ensure we have the necessary funding        Cash flow summary (£m)
                                               to replace our existing assets and, where
More than one third of these costs will        prudent, invest in enhancements.
                                                                                                                                                                                               2020/21
be offset by £193m of planned savings                                                                                                            2020/21     Variance to                      variance
through our cost reduction programme,          The working capital movement is a result                                              2020/21    Business       Business         2019/20     to 2019/20
encompassing supply chain savings across       of the Budget having a lower level of          TfL Group                              Budget         Plan            Plan       forecast       forecast
the Underground, bus contract savings,         creditors than the Business Plan. This
                                                                                              Net cost of operations                    (571)      (493)             (78)          (203)            (368)
accommodation and back office.                 has been influenced by the reduction in
                                               capital expenditure since the Business         Net capital account                       575          547               28           720             (145)
                                               Plan, following a review of our major          Working capital movements                (264)         (67)            (197)          (20)            (244)
                                               programmes.
                                                                                              Increase/(decrease) in cash balances     (260)         (13)           (247)           497             (757)

                                                                                                                                                            Transport for London Budget 2020/21          11
Meeting our challenges
Passenger demand has the biggest impact on our finances and we face
a series of challenges to maintain our robust financial performance
Our organisation faces a number of              Like-for-like operating costs (£m)                                                      Savings programme
headwinds and tailwinds, which we must                                                                                                  As part of our strategy to breakeven on the
adapt to. Passenger journeys are largely                                                                                                day-to-day costs of operations, we initiated
                                                (5,900)
determined by economic growth and                                                                                                       a savings programme in 2015/16, reviewing
employment, areas where the outlook                                                                                                     all aspects of our organisation including
remains subdued. While the immediate risk                                   5,640              5,639     5,586     5,609      5,653     structure, accommodation, headcount,
of a no-deal departure from the European                                                                                                commercial contracts and our vast supply
Union has evaporated, there is still a great    (5,800)       (5,817)                                                                   chain. The initial phase of this programme
deal of uncertainty. We are also faced with                                                                                             saved £747m by the end of 2018/19 and we
inflationary pressures across our cost base,                                                                                            will have saved a further £211m in costs by
while introducing new services, changing                                                                                                the end of this financial year. This means
behaviours to support walking and cycling,      (5,700)
                                                                                                                                        we will have removed almost £1bn over
and reducing the number of people killed                                                                                                four years – before inflationary pressures
or injured on our roads.                                                                                                                and increased costs for new services – from
                                                                                                                                        our cost base.
                                                                                                                              (5,660)
Like-for-like costs                                                         (5,640)            (5,639)
Through our savings programme and a             (5,600)                                                                                 Our 2019 Business Plan set out plans for
                                                                                                                   (5,609)
tight grip on costs, we have reduced our                                                                                                further savings of almost £600m, from
                                                                                                         (5,586)
like-for-like operating costs, adjusted for                                                                                             2020/21 to 2024/25, with £133m of these in
new services, restructuring and other one-                                                                                              2020/21. To mitigate income pressures from
off costs, each year from 2015/16 to 2018/19.   (5,500)
                                                                                                                                        lower journeys, we are now increasing our
Costs in 2020/21 will be around £150m lower                                                                                             savings this year to £193m.
than they were when we began the savings
programme in 2015/16. We expect to see                                                                                                  London Underground change plan
an increase in 2020/21, driven mainly by                                                                                                The London Underground change plan is
higher pension contributions following an       (5,400)                                                                                 critical to our future viability, to ensure
                                                              2015/16       2016/17            2017/18   2018/19   2019/20    2020/21
agreement with the Pensions trustees.                                                 Actual                       forecast   Budget
                                                                                                                                        the Tube can cover its own costs and the
                                                                                                                                        ongoing costs of renewing the network.
                                                                                                                                        The focus in 2020/21 is supply chain savings,
                                                          Operating costs
                                                                                                                                        and extensive planning for future savings
                                                                                                                                        over the Business Plan period.

                                                                                                                                              Transport for London Budget 2020/21   12
Key savings this year include the Connect       We are consolidating our head office           Passenger journeys (millions)                                                       We now expect Tube journeys to be 1,403
London Underground network radio                accommodation by co-locating staff across                                                                                          million (0.8 per cent lower) in 2019/20, when
infrastructure, which was originally            three main office hubs. In September 2019,                                                                                         compared to the Business Plan, with bus
contracted under a 20-year private finance      we sold our Broadway head office as part                                                                                           journeys to be 2,193 million (0.6 per cent
                                                                                               4,500
initiative. This contract ended in November     of a long-term estate management strategy                4,053          4,010          4,022           4,019        4,024          lower). For 2019/20, this means there will
2019, with a new contract set to reduce         to reduce accommodation costs, and                                                                                                 be an underlying impact of £38m on our
                                                                                                           24             23             23             22            23
costs by almost 50 per cent. This is driven     generate income to support investment          4,000                                                                               income against our 2019 Business Plan.
by ending loan repayments and rationalising     and housing development programmes. We                    341            338            340             341          342
operational and maintenance costs.              will see full-year savings of £5m in 2020/21                                                                                       Latest economic indicators suggest this
                                                                                               3,500     2,262                                                       2,171
                                                from accommodation programmes.                                          2,247          2,220           2,193                       decline in growth will continue into next
We will also make maintenance savings                                                                                                                                              year. The forecast for economic growth and
across the Underground by re-tendering          Our accommodation strategy is supported        3,000                                                                               employment trends have been downgraded
contracts, improving forecasting and            by a smart working programme, which will                                                                                           to reflect continued uncertainty. Latest
planning, making specification changes, and     reduce the demand for desks by 30 per                                                                                              forecasts also suggest household income
                                                                                               2,500
other in-contract mechanisms.                   cent. It will also make us a more attractive                                                                                       will decline in 2020/21, before returning to
                                                employer and improve the work-life                                                                                                 growth. These headwinds are expected to
Bus operators’ contracts                        balance for our people. We will also achieve   2,000                                                                               reduce passenger income by £60m from
We have reduced tender prices, contract         efficiency savings through smarter working                                                                                         our 2019 Business Plan.
costs and bus performance payments,             and better technology.
                                                                                               1,500               48             45             55            60             75
by maintaining a competitive market and                                                                                                                                            We now expect the overall number of
expect to save a further £20m in 2020/21.       Lower journey demand                                      1,378          1,357         1,384           1,403         1,413         passenger journeys to increase from 4,019
                                                Our 2019 Business Plan was based on            1,000                                                                               million in 2019/20 to 4,024 million in 2020/21.
We will continue to adapt the bus network       increasing passenger income – through
to more closely match capacity to demand,       higher demand on the Tube – and bearing                                                                                            The following graphs on pages 14 and 15
                                                                                                500
including increasing bus services in growth     down on our day-to-day costs, all while                                                                                            show the forecast range of passenger
areas in outer London                           maintaining safety, frontline services and                                                                                         journeys, factoring in economic scenarios,
                                                investment. However, we have since seen           0                                                                                as informed by forecasts from GLA
Transformation and office                       slower growth in Tube demand, as well as                 2016/17        2017/18        2018/19         2019/20      2020/21        economics. Favourable economic
                                                                                                                        Actual                        forecast      Budget
accommodation                                   a higher rate of decline in bus journeys.                                                                                          performance is reflected by the highest
In late 2018/19, we began a three-year                                                                                                                                             point, while poorer economic conditions
                                                                                                       London Underground                         Elizabeth line
programme to reduce back- and middle-                                                                                                                                              result in the lowest point.
office costs by 30 per cent. We have worked                                                            Buses                                      Rail
with our trade unions to review 25 business
areas and more than 3,000 roles. We have                                                               Other operations
already saved almost £20m from this
initiative, with a further £5m expected to be
saved in 2020/21.

                                                                                                                                                                                          Transport for London Budget 2020/21    13
Buses                                                                                                           Rail
Passenger journeys (millions)                                                                                   Passenger journeys (millions)

2,400                                                                                                           360
                                                              Economic growth, bus operated kilometres                                                                     Internal factors that affect rail demand
                                                              and speeds are the main drivers of demand.                                                                   include planned engineering closures, new
2,350                                                         The year-to-date figures to December 2019         355                                                        train deployments and changes to the
                                                              showed bus speeds were flat compared to                                                                      frequency of services.
                                                              2018/19, while bus operated kilometres were
2,300                                                         about 1.5 per cent lower. This is in line with    350                                                        In 2019/20, we expect DLR demand to
                                                              the central London bus service review, as                                                                    remain static, while we will see a small
                                                              we reshape services in central and inner                                                                     increase in London Overground journeys,
2,250                                                         London to deliver a more efficient network        345                                                        owing to an increase in the number of
                                                              ahead of increases in the outer London bus                                                                   services and the introduction of new trains
                                                              network. We expect bus journeys to decline                                                                   between Gospel Oak and Barking.
2,200                                                                                                           340
                                                              by 1.2 per cent in 2019/20, owing to relatively
                                                              low economic growth, the fifth consecutive                                                                   In 2020/21, the further delay in the
                                                              year of falling bus demand.                                                                                  opening of the Elizabeth line has been
2,150                                                                                                           335
                                                                                                                                                                           reflected in the DLR budget, with a slightly
                                                              In 2020/21, budgeted journeys are expected                                                                   stronger demand uplift mostly offset by
2,100                                                         to decline by 1.0 per cent year on year, with     330
                                                                                                                                                                           weaker economic growth next year. The
                                                              fare payer demand declining by 0.9 per cent                                                                  introduction of new trains and better peak
                                                              and non-fare payer journeys 1.2 per cent                                                                     and off-peak timetables on the London
2,050                                                         lower. This represents an improvement in          325                                                        Overground in north and east London will
                                                              the trend we have seen since December                                                                        boost journeys by two million in 2020/21,
                                                              2019, as operated kilometres start to                                                                        after allowing for more planned engineering
2,000                                                         stabilise following the redistribution of         320                                                        closures in east London.
         2017/18    2018/19    2019/20   2020/21    2021/22                                                           2017/18    2018/19    2019/20   2020/21    2021/22
               Actual         forecast   Budget    forecast
                                                              services to better match demand, which
                                                                                                                            Actual         forecast   Budget    forecast
                                                              includes increasing bus kilometres in outer                                                                  Trams demand is forecast to be lower in
        Historic actuals and forecast used                    London. In 2020/21, our assumptions about               Historic actuals and forecast used
                                                                                                                                                                           2019/20 reflecting the poor high street retail
                                                              operated kilometres and bus speeds remain                                                                    activity, impacting areas such as Croydon
        Range of forecast                                     unchanged from the 2019 Business Plan,                  Range of forecast                                    town centre.
                                                              while economic growth is predicted to be
                                                              weaker based on the GLA’s latest forecasts
                                                              for the UK economy.

                                                                                                                                                                                  Transport for London Budget 2020/21    14
London Underground                                                                                          Growing non-fare revenue                      new opportunities in Canary Wharf and
Passenger journeys (millions)                                                                               We are uniquely placed to use our assets      other stations.
                                                                                                            and skills, as well as our property and
                                                                                                            advertising estates, to generate long-term    Our advertising estate is one of the most
1,460
                                                              Underground journeys are expected to          revenues to reinvest back into our network.   valuable in the world, accounting for 20
                                                              be more than one per cent higher than         A more diverse range of income also           per cent of the UK’s and 40 per cent of
1,440                                                         the previous year. Underlying growth          supports our financial security, as we will   London’s outdoor advertising value. We
                                                              was moderate for most of 2019 but this        be less dependent on the economies of the     have introduced innovative high-tech
                                                              stalled from the end of October, with         UK and London.                                advertising platforms and are finding new
1,420                                                         early indications of declining growth.                                                      ways to collaborate more creatively with
                                                              The number of journeys outside Zone           As one of London’s largest landowners,        brands and advertisers.
                                                              1 has been in decline over the last two       our landholdings play an important role in
1,400                                                         years, which likely reflects a reduction in   meeting the Mayor’s priorities to deliver     We continue to develop our transport
                                                              discretionary journeys, probably caused       the thousands of homes and jobs that          authority consultancy work, partnering
                                                              by a continued squeeze on household           the Capital needs. We have an extensive       with cities, regions, consultancies and
1,380
                                                              incomes. Continued employment growth is       pipeline of sites and a target to deliver     transport operators around the world to
                                                              contributing to robust commuter demand.       10,000 homes. We are working with our         deploy our unique, specialist expertise. We
                                                                                                            partners to achieve our target of making 50   will focus on three key work streams of
1,360
                                                              The most significant factors affecting        per cent of homes affordable. We will also    advisory services, intellectual property, and
                                                              London Underground demand that                continue to develop sites that will deliver   operations and maintenance to generate
1,340                                                         are within our control include service        two million square feet of commercial         revenue that can be reinvested into our
                                                              improvements, reliability and asset           floor space.                                  transport system.
                                                              upgrades. The assumptions built into this
1,320                                                         Budget include a small number of service      We continue to invest in our commercial       Maximising these opportunities and
                                                              improvements and station upgrades that        estate, which consists of more than 2,000     building our commercial reputation will
                                                              increase demand.                              commercial units, expanding opportunities     diversify our income base and improve our
1,300                                                                                                       to make the most of our unique asset          financial resilience.
         2017/18    2018/19    2019/20   2020/21    2021/22
               Actual         forecast   Budget    forecast
                                                                                                            base and increase revenue. We continue to
                                                                                                            upgrade our arch estate, are refurbishing
        Historic actuals and forecast used                                                                  the listed Victoria Arcade to create new
                                                                                                            modern retail units, and we are creating
        Range of forecast

                                                                                                                                                                Transport for London Budget 2020/21    15
Managing our risks
                                                          We face a range of risks, including economic
                                                          uncertainty and the delay to the opening of the
                                                          Elizabeth line
                                                          Delivering this Budget requires balancing       Economic uncertainty also affects our
                                                          risks and opportunities, identifying what       other income. This creates risk against our
                                                          we can and can’t control, and taking            planned growth in retail leases, and the
                                                          an informed view of our organisational          sub-letting of office floorspace.
                                                          tolerance to them based on their impact.
                                                          We regularly monitor the validity of our        The income we receive from schemes
                                                          assumptions and use data from external          such as the ULEZ and Congestion Charge,
                                                          independent bodies, so we can manage            is also subject to variation. If higher than
                                                          risks and capitalise on opportunities. Safety   anticipated compliance rates continue,
                                                          is the top priority in any decision we make.    as they did in 2019/20, this has a positive
                                                                                                          impact on the transport network and the
                                                          Key risks in the 2020/21 Budget still include   environment, but reduces the income we
                                                          economic uncertainty, given the political       receive from these schemes.
                                                          and economic situation in London and
                                                          the UK, which is a key driver of passenger      While income is often subject to factors
                                                          journeys and income. They also include the      outside our control, we have more
                                                          opening of the Elizabeth line, and delivering   influence to manage our costs. In 2020/21,
                                                          investment projects on time and budget,         we plan to save £193m in operating costs,
                                                          ensuring associated income is received          as described on page 12. These changes
                                                          in line with our plans. This Budget also        represent a significant management
                                                          includes an ambitious savings target of         challenge, which we monitor and will act
                                                          £193m this year, with a risk that not all of    on as required.
                                                          this will be delivered to schedule.
                                                                                                          We operate a work bank of renewals.
                                                          Passenger income is budgeted to contribute      Additional scrutiny has been placed on this
                                                          around 50 per cent of our overall £9.7bn        Budget to ensure it accurately reflects the
                                                          funding in 2020/21. The health of the           interventions required to maintain asset
                                                          economy and employment are the main             condition and the volume of work we can
                                                          drivers of changes in demand for our            deliver. However, planned work can be
                                                          services, and our forecasts are built from      delayed, for example due to unforeseen
                                                          prudent economic forecasts, using data          events and resource constraints.
                                                          from GLA economics. However, continued
                                                          economic volatility makes these forecasts
                                                          less certain. For example, this Budget
                                                          assumes bus passenger demand will
                                                          stabilise, with a 1.0 per cent reduction
                                                          in journeys, the smallest reduction
                                                          since 2017/18. It also assumes continued
                                                          passenger growth on the Underground.

This Budget assumes bus passenger demand will stabilise                                                          Transport for London Budget 2020/21    16
Our expenditure on new capital investment
Crossrail                                  is harder to predict as this is a collection
                                           of individual projects at different stages
                                                                                          Preparing for the UK outside of the European Union
The delay to the opening of the            of their lifecycle. The main financial risk
Elizabeth line, announced in August        relates to increased costs, such as higher
2018, continues to have a major            tender prices or unplanned requirements
impact on our capital funding and          on existing projects. Our projects are often
revenue generation. Elizabeth line         complex and there is risk that timings can
services through central London are        slip, often due to approval delays or to
now expected to start in summer            accommodate stakeholder requirements.
2021. However, as the programme            This results in lower in-year costs. We seek
is currently at a challenging phase,       to avoid delays as this ultimately delays
with systems integration and testing       improvements to our services.
to complete, there will remain a risk
over the costs, which we will be           Our capital funding sources consist of
monitoring closely.                        Mayoral business rates, property receipts
                                           and asset sales, borrowing, Crossrail
                                           funding sources, and other capital grants.
                                           Most of these sources have a low degree
                                           of in-year risk. However, income for
                                           property receipts and asset sales is a risk,
                                           determined by the economy, property
                                           market, local planning administration and
                                           commercial negotiations. Beyond 2020/21,
                                           the certainty of our funding arrangements
                                           and borrowing are unknown and will
                                           be discussed with the Government as
                                           part of the 2020 Spending Review. This
                                           certainty is vital for making investment       Since the UK began the process of           demand for our services towards the end
                                           decisions that will drive the future growth    leaving the European Union, we have         of this financial year.
                                           and enhancement of London’s transport          been monitoring and managing the
                                           network.                                       risks associated with this change, and      We remain confident that our operations
                                                                                          supporting our people who are affected.     will continue in all scenarios. However,
                                                                                          This work will continue as we await         our financial position is closely related
                                                                                          details of the long-term arrangements       to the strength of the London and
                                                                                          that will follow on from the current        UK economy, and any outcome that
                                                                                          transition period, which is due to expire   weakens this will have implications for
                                                                                          on 31 December 2020. Any significant        our finances. Throughout this year we
                                                                                          change to trading and mobility at that      will continue to carefully manage the

              52%
              of our overall funding to
                                                        1.0%
                                                        reduction in bus journeys
                                                                                          time would have a significant impact
                                                                                          on our long-term financial position, as
                                                                                          well as potential short-term impacts on
                                                                                                                                      risks and maintain a strong cash position
                                                                                                                                      so that we can deal with any potential
                                                                                                                                      negative outcomes.
              come from passenger income                assumed, the smallest reduction
              in 2020/21                                since 2017/18

                                                                                                                                              Transport for London Budget 2020/21    17
Debt and cash
We control the level of our debt and maintain prudent levels of cash

Total value of debt (£m)                                                                                                              Cash balances (£m)

18,000                                                                                                                                2,500
                                                                                     The total value of our debt, which includes                                              2,379                    We maintain a prudent minimum level
                                                                      15,917         borrowing and finance leases, must                                                        119                     of cash, in line with the liquidity policy
16,000                                                                               always remain within our Authorised                                                                 2,119
                                                                                                                                                                                                       approved by the TfL Board. This ensures
                                                         14,599       2,438          Limit for external debt set by the Mayor.                                                2,260               61   we are always able to meet our payment
                                                                                     Affordability is linked to both recurring        2,000    1,961
                                                                                                                                               XXX       XXX
                                                                                                                                                         1,932     XXX                                 obligations and will help us deal with
14,000                                                   2,397                                                                                                     1,882                2,058
                                                                               428   annual income and cash available to pay                    566
                                                                                                                                                                                                       unexpected external events if they arise.
                                                                                                                                                          671
                                                                                     financing costs.                                                                211
                                         11,726                   483 13,051
12,000
                                                   551                                                                                                                                                 We will close 2019/20 higher than 2018/19, as
                         10,935
         10,386                    488                                               By 31 March 2021, borrowing is expected to                                     1,671                              we experienced higher passenger income,
                                                         11,719                                                                       1,500
                   558                   11,175                                      grow by £1,332m, within the limits agreed                                                                         new income from the introduction of
10,000
                         10,447                                                      with the Government. This includes an                                                                             the ULEZ, lower capital spend and more
          9,828                                                                                                                                1,395
                                                                                     assumption of £750m borrowing under the                                                                           property and capital receipts from the sale
                                                                                                                                                          1,261
8,000                                                                                Crossrail loan facility from Government.                                                                          of assets, including Broadway.
                                                                                     Our borrowing will finance capital               1,000
                                                                                     investment, including Tube and rail line                                                                          Cash balances are expected to close at
6,000
                                                                                     upgrades, and new DLR trains.                                                                                     £2.1bn at the end of 2020/21, excluding the
                                                                                                                                                                                                       cash we hold for the Crossrail project,
4,000                                                                                The new accounting standard IFRS 16, which                                                                        London Transport Museum and London
                                                                                                                                       500
                                                                                     supersedes IAS 17, means we will now                                                                              Transport Insurance Guernsey. Our cash
                                                                                     recognise additional finance lease liabilities                                                                    balances will reduce in 2020/21, as we
2,000
                                                                                     of £2.4bn in 2020/21. These are existing                                                                          continue to fund our asset programme.
                                                                                     contracts and were previously classified
    0                                                                                as operating leases. We are in consultation         0
         2016/17         2017/18         2018/19      2019/20        2020/21                                                                   2016/17   2017/18   2018/19    2019/20   2020/21
                                                                                     on the eventual impact, if any, that the                            Actual              forecast   Budget
                         Actual                      forecast        Budget
                                                                                     application of IFRS 16 will have on the
                                                                                                                                                                                                       Credit ratings
         Borrowing                   Finance leases and other                        borrowing limits currently agreed with                   TfL cash balances
                                     financing liabilities                           the Government.                                                                                                   Moody’s                         Aa3 stable outlook
                                                                                                                                              Crossrail project, London Transport Museum
         IFRS 16 Finance leases liabilities                                                                                                   and London Transport Insurance Guernsey                  Standard & Poor’s             AA- negative outlook
                                                                                                                                              cash balances
                                                                                                                                                                                                       Fitch                           AA- stable outlook

                                                                                                                                                                                                       Strong credit ratings reflect our strategic
                                                                                                                                                                                                       importance as London’s main public
                                                                                                                                                                                                       transport provider, strong demand for our
                                                                                                                                                                                                       services and our institutional framework.
                                                                                                                                                                                                       Our ratings also reflect our strong link to
                                                                                                                                                                                                       the Government.

                                                                                                                                                                                                               Transport for London Budget 2020/21     18
Financial trends
We use forecasts from costs and income streams to
make decisions on our finances and priorities
Total income (£m)                                              Total cost (£m)                                              Total capital expenditure (£m)

8,000                                                          8,000                                                        4,000

                                           7,073     7,055                                                        7,093
                                                                                                                                      3,453     3,487
          6,768               6,716                                                          6,749      6,792
7,000               6,570                                      7,000
                                                                         6,553     6,642                           468      3,500
                                            1,020     1,006                                                                                      538
                                                                                              454        448                           615
           726                 812                                        413       428                                                                   3,023
                     759                                                                                          6,625
6,000                                                          6,000                         6,295      6,344               3,000
                                                                         6,140     6,214
          1,348                             1,101     986                                                                                                  388
                     1,168    1,050                                                                                                              1,419               2,601     2,591
                                                                                                                                      1,245
5,000                                                          5,000                                                        2,500                         1,246       484       533
                                            4,952    5,063
                              4,854
          4,694     4,643
4,000                                                          4,000                                                        2,000
                                                                                                                                                                     1,078
                                                                                                                                                                                1,333

3,000                                                          3,000                                                        1,500
                                                                                                                                      1,593
                                                                                                                                                1,530
                                                                                                                                                          1,389
2,000                                                          2,000                                                        1,000
                                                                                                                                                                     1,039

1,000                                                          1,000                                                         500                                                725

   0                                                              0                                                            0
          2016/17   2017/18   2018/19      2019/20   2020/21             2016/17   2017/18   2018/19    2019/20   2020/21             2016/17   2017/18   2018/19    2019/20   2020/21
                    Actual                forecast   Budget                        Actual              forecast   Budget                        Actual              forecast   Budget

        Passenger income                Business rate                  Operating costs            Net financing costs               Crossrail programme
                                        retention and
        Other income                    other revenue grants                                                                        New capital investment          Capital renewals

Despite an increase in passenger income,                       The increase in operating costs relates                      Overall capital expenditure remains broadly
overall income decreases by £18m in                            to the introduction of new trains on                         in line with last year. An increase in our
2020/21, largely because of one-off grants                     London Overground, and preparation for                       investment programme is offset by a
we received in 2019/20 that will not be                        the opening of the Elizabeth line. It also                   reduction in Crossrail capital expenditure.
repeated, as well as a reduction in income                     includes inflation. These increases are
from the ULEZ and Congestion Charge.                           partly offset by savings.

                                                                                                                                                                                         Transport for London Budget 2020/21    19
Efficiency trends
The costs of running our wide range of transport services

London Underground                                      Buses                                                    Streets                                                    Rail
Direct operating cost per operated km (£)               Direct operating cost per operated km (£)                Direct operating cost per operated km (£)                  Direct operating cost per operated km (£)

30                                                      4.8                                                       1.1                                                       30

                                                                                                                                                                            25
28                                                      4.6                                                      1.0

                                                                                                                                                                            20

26                                                      4.4                                                      0.9

                                                                                                                                                                            15

24                                                      4.2                                                      0.8

                                                                                                                                                                            10

22                                                      4.0                                                      0.7
                                                                                                                                                                             5

20                                                      3.8                                                      0.6                                                        0
     2016/17   2017/18   2018/19    2019/20   2020/21         2016/17   2017/18   2018/19    2019/20   2020/21          2016/17    2017/18   2018/19    2019/20   2020/21        2014/15   2015/16   2016/17   2017/18   2018/19
               Actual              forecast   Budget                    Actual              forecast   Budget                      Actual              forecast   Budget                             Actual

      London Underground                                       Buses                                                     Streets                                                  London Overground

                                                                                                                                                                                  Trams              DLR

These costs increase slightly in 2020/21,               Over recent years, these costs have risen                Operating costs have reduced as a result                   Costs have generally fallen, with variation
but these increases are minimised as                    broadly in line with inflation. We are                   of pausing proactive road maintenance for                  reflecting operating conditions. London
our ongoing modernisation programme                     working with our operators and improving                 two years, owing to a lack of dedicated                    Overground operating costs increased
substantially mitigates inflation.                      how we tender contracts to control costs                 funding. These costs will rise again as we                 in 2018/19, largely due to new train leases
                                                        while improving the fleet.                               return closer to previous levels of activity.              under the LOTRAIN agreement.

                                                                                                                                                                                    Transport for London Budget 2020/21           20
Assets and investment priorities
We are investing to maintain our assets, but with additional
funding we could unlock new capacity

Our 2019 Business Plan set out our                                                              Signalling                                      support the delivery of tens of thousands
investment programme for the next five             ‘We are beginning a                         The Four Lines Modernisation programme          of new homes across the Piccadilly line
years and was accompanied by a 20-                  crucial programme of                        will see us replace analogue signalling         corridor and boost productivity and access
year Capital Strategy that described our                                                        with automatic train operation across           to jobs. We will only be able to commit to
longer-term investment priorities and               modernisation for our                       the Circle, District, Hammersmith & City        this transformational scheme if we secure
funding requirements. Certainty of funding          Central line trains’                        and Metropolitan lines. Once completed          long-term funding support from central
is essential if we are to commit to the                                                         by 2023, customers will benefit from a          Government. We will continue to make the
projects required to maintain reliability and                                                   33 per cent increase in capacity across         case for that this year.
support growth over this timeframe.                                                             the four lines. We have already delivered
                                                                                                the first sections of signalling between        Track, power, lifts and escalators
Renewing and replacing our assets is our                                                        Hammersmith and Paddington to Euston            We will continue our track renewal
required baseline to simply maintain our                                                        Square, and Finchley Road to Euston Square.     programme, including replacing 7.3km
current performance in terms of safety,                                                         In 2020/21, we will continue to work towards    of life-expired track. This is critical to
reliability, capacity and asset condition.                                                      transitioning the entire Circle line onto the   supporting service reliability, and increased
Additional enhancements can unlock new                                                          new signalling system.                          train speeds and frequencies. As part of
capacity and enable us to use our existing                                                                                                      our ongoing maintenance, we will continue
network more intensively. This supports                                                         We will continue to extend the life of the      rail grinding to remove defects, helping to
London’s growing population and economy,                                                        signalling system on the Central line and       reduce noise and vibration for passengers,
enhances the quality of life for Londoners                                                      will re-signal Northumberland Park Depot,       staff and people living and working near the
and creates jobs and improves skills             Through our renewal programme, we will         which serves the Victoria line. These works     lines.
across the UK. This year, we will maintain       work on the Victoria and Metropolitan line     are essential to maintain the performance
reliability on our Tube and rail modes, while    fleets, both of which are now 10 years old.    of these systems to deliver a reliable          We will upgrade power supplies to enable
restoring our renewals programme on our          We will complete the preliminary design        service and meet capacity requirements.         an additional train to run each hour during
streets assets. We will continue to lobby        of the new trains we have ordered for the                                                      the peak on the Morden branch of the
the Government for sustained funding             Piccadilly line, which will enter service      Replacing the signalling system on the          Northern line. We will also refurbish or
support to enable us to be much more             between 2024 and 2026, and complete work       Piccadilly line, parts of which date back to    replace 20 escalators and four lifts in our
ambitious in later years.                        on the existing fleet to ensure reliability    the 1950s, is one of our highest priorities.    stations to ensure reliability.
                                                 until then.                                    Replacing this system with a modern digital
Rolling stock                                                                                   network would provide faster and more           Major highways structures
We are beginning a crucial programme of          Design will continue for the new fleet         frequent trains, with a train arriving every    Our investment will maintain the safety of
modernisation for our Central line trains,       of DLR trains, which will be introduced        100 seconds in central London. This would       bridges and tunnels to enable goods and
one of our poorest-performing fleets.            from 2023. We will also run new trains
Through the Central Line Improvement             on London Overground services to and
Programme, we will replace all traction          from Liverpool Street and our reliability
motors, create more space for wheelchair         improvement programme will continue on
users, improve audio and visual                  the existing fleet. We will start design and
information, and install CCTV. The first
upgraded train will return to service in early
2021, and the whole programme will be
                                                 market engagement activities to replace the
                                                 oldest trams on our network, and maintain
                                                 the condition of the vehicles while they
                                                                                                7.3km
                                                                                                of life-expired track will be replaced
                                                                                                                                                             20
                                                                                                                                                             escalators and four lifts will be
completed by 2024.                               remain in service.                                                                                          refurbished or replaced across
                                                                                                                                                             our Tube stations

                                                                                                                                                      Transport for London Budget 2020/21       21
people to move throughout the Capital.         temporary bridge while the main structure      We will continue to improve the energy          can receive accurate and timely information to
The Rotherhithe Tunnel was built in 1908       is being repaired.                             efficiency of street lighting. More than half   help them plan their journey.
and was not designed to cope with modern                                                      of our 33,900 street lighting columns will be
levels of traffic. This year we will start     We are also starting a programme of            installed with greener LED luminaires, with     We are also taking steps to further protect
detailed design on restoration works, and      renewal works on the Westway (A40) and         3,000 more set to be converted before the       our staff and revenue. Body-worn video
we will seek approval for concept design by    will seek approval for concept design          end of 2020.                                    equipment is currently being piloted as part of
October 2020.                                  by March 2021. We are working with the                                                         a strategy to stop violence against our people,
                                               Department for Transport to progress           Buses                                           and we have a strategy in place to reduce lost
We are working with and supporting             our Major Road Network funding bids to         Maintaining, renewing and refurbishing          revenue. This will ensure our colleagues have
local authorities to confirm a plan for the    refurbish key bridges on our network.          bus infrastructure will provide a safe,         the tools they need to work effectively and
refurbishment of Hammersmith Bridge.           These include the Brent Cross structures,      comfortable and appealing environment           safely.
We are also investigating options to build a   Croydon Flyover, Hope & Anchor Flyover         that will encourage people to use public
                                               and Kew Bridge.                                transport. In our 2019 Business Plan we         We continue to drive forward our digital
                                                                                              increased investment in maintaining bus         workplace, with regular software updates,
                                               The condition of our smaller assets has        shelters and stations to boost passenger        eradicating the need for large upgrade
  ‘In spring 2020, five new                    declined slightly due to the two-year pause    numbers. This year we will replace 325          programmes. We will spend a further £1.25m
                                               on renewal work, which means additional        bus shelters and refurbish a further 25,        on end-user computing, which will support
  docking stations will                        safety measures are required. This year, we    alongside ongoing repairs.                      flexible working. We are also researching
  open along Cycleway 4 in                     will carry out additional inspections and                                                      infrastructure technology and investing in
  Southwark and we plan to                     interim measures on 43 bridges.                Cycle hire                                      cloud-based assets to reduce operational cost
                                                                                              In spring 2020, five new docking stations       and enhance security against cyber-attacks.
  expand docking stations on                   Highways assets                                will open along Cycleway 4 in Southwark
  our Cycleways network’                       We are responsible for London’s most           and we plan to expand docking stations
                                               strategically important roads. These           elsewhere along our Cycleways network.
                                               comprise many types of assets including        We will also renew 3,700 Santander Cycles
                                               580km of carriageway, 6,300 traffic signals,   bicycles this year.                               ‘We will award the wider
                                               and 1,238 pedestrian countdown locations                                                         concession to enable mobile
                                               This year, we plan to resurface more than      Technology
                                               30km of road, modernise around 50 traffic      Technology investments will ensure we             connectivity to be brought
                                               signal sites, replace 800 lighting columns     continue to improve safety, customer              to the whole Tube network’
                                               and 600 trees.                                 service and operational reliability.

                                                                                              Providing easy access to information
                                                                                              ensures a smoother journey experience.
                                                                                              Following the introduction of 4G services
                                                                                              on the Underground, with a pilot launching
                                                                                              on a section of the Jubilee line, we will
                                                                                              award the wider concession to enable
                                                                                              mobile connectivity to be brought to

                      325
                      bus shelters will
                                                            3,000
                                                            street lights will be replaced
                                                                                              the whole Tube network. Through our
                                                                                              Bus Technology Programme, we will
                                                                                              refresh service planning assets, real-time
                      be replaced                           with LED luminaires by the        information, ticketing and performance
                                                            end of 2020
                                                                                              management. This will ensure customers

                                                                                                                                                    Transport for London Budget 2020/21    22
Delivering the
Mayor’s Transport
Strategy
We will align our work to the Mayor’s Transport
Strategy, which emphasises support for Healthy
Streets and healthy people, a good public
transport experience and new homes and jobs
Healthy Streets
and healthy
people
The Mayor’s Transport Strategy makes a
commitment to Vision Zero – eliminating
all deaths and serious injuries on London’s
transport network by 2041. We will work
towards this by delivering ambitious schemes
to reduce road danger.
Our Healthy Streets Approach aims to create
far-reaching improvements on London’s
roads, in collaboration with our borough
partners. This includes improving safety,
increasing sustainable transport use, and
creating pleasant environments.
By creating places that feel safe to use, we
will encourage people to get out of their cars
and use more sustainable modes of travel.
We can only achieve this through steady and
sustained long-term funding.

                  Transport for London Budget 2020/21    24
Safe buses
Safe streets                   Greener buses                                                                                                                      Rolling out our
                                                                                                                                                                  Direct Vision
We will continue to                                                                       We will use a combination of training and
work alongside the                                                                        technology to improve safety for bus passengers                         Standard scheme
Metropolitan Police’s                                                                     and other road users
Roads and Transport                                                                                                                                               Lorries account for just
Policing Command to                                                                       We want to reduce the number of people killed or seriously              four per cent of the
identify and target the                                                                   injured on, or by, a bus by 70 per cent by 2022 (against 2005-          overall miles driven
root causes of road                                                                       09 levels), with all deaths on or by a bus eliminated by 2030.          in the Capital, but
danger at a number                                                                                                                                                between 2015 and 2017,
of high-priority                                                                          Our world-leading Bus Safety Standard will continue to                  heavy goods vehicles
locations. We will                                                                        be rolled out, having been incorporated into new bus                    (HGVs) were involved
use a combination of                                                                      operator contracts last year. This sets out design features             in 63 per cent of fatal
enforcement, education                                                                    and technologies required of new buses, to minimise the                 collisions involving
and engineering                                                                           risk of injuries. We now have 129 buses that meet the Bus               cyclists and 25 per cent
measures.                      We will continue to upgrade the entire bus fleet to        Safety Standard and 1,229 (13 per cent) that are enabled                involving pedestrians.
                               meet the ultra-low Euro VI standard or better by           with intelligent speed assistance to prevent vehicles from
We will significantly          retrofitting mid-life buses with enhanced exhaust          exceeding the speed limit. By October 2020, we will have                Our new HGV Safety
increase our camera            systems and replacing older buses with new vehicles.       started retrofitting buses. An acoustic vehicle alerting system         Permit scheme, which
and on-street speed            So far, around 90 per cent of the fleet meets or betters   – to make quiet running buses identifiable to vulnerable road           comes into force in
enforcement activity to        this standard.                                             users – will be required on all new buses.                              October 2020, will
reduce the risk speeding                                                                                                                                          require all HGVs more
motorists continue to          By autumn 2020, the entire fleet will meet a Euro VI       As part of our continued work on fatigue management,                    than 12 tonnes to hold a
pose on our streets.           standard. We are already working on the next steps         we will ensure all bus operators have robust fatigue risk               Safety Permit to operate
                               to ensure our fleet is even cleaner, by converting the     management systems in place and that all managers receive               in Greater London.
We will also continue to       entire fleet to zero-emission at tailpipe by 2037 at       specific fatigue training. We will also launch a £500,000
enforce decriminalised         the latest. We have a good starting point with more        fatigue innovation fund to encourage development and                    Our Direct Vision
offences – such as             than 280 zero-emission buses already and expect the        trial of new measures aimed at preventing fatigue. Our new              Standard (DVS) rates
parking contraventions –       number to climb to up to 500 zero-emission buses,          Destination Zero safety training for all London bus drivers,            how much an HGV
to improve compliance          including single and double decks by 31 March 2021.        which uses virtual reality headsets, will continue until the            driver can see directly
with the rules of the                                                                     end of 2020.                                                            from their cab in
road, reduce road                                                                                                                                                 relation to other road
danger and improve the                                                                                                                                            users and assigns a star
                            Increasing the amount of green space
                                                                                          70%
reliability of our buses.                                                                                                                                         rating from zero to five.

Working closely with                                                                                                                                              Those vehicles that do
                                                                                          reduction in the number of
the local boroughs,         We will upgrade the environment across 90 high streets        people killed or injured on or                                          not meet a minimum
law enforcement and         through our Bees, Trees and Meadows programme. This           by a bus by 2022, compared to                                           DVS star rating of one
security agencies,          will see 1,000 trees planted across our street network and    2005-2009 levels                                                        star will be required to
we will continue to         a further roll out of the grass verge meadows programme,                                                                              have additional safety
design and implement        following a successful trial on the A40 and A406 last year.                                                                           equipment fitted.
protective security
measures on London’s
roads. This work is
                            In the spring, we will be creating five green roofs on bus
                            shelters in Lewisham, which have been specially selected to
                                                                                          £500k
                                                                                          funding to develop and trial
                                                                                                                                                                  Permits will be
                                                                                                                                                                  electronic and enforced
designed to reduce the      encourage more honeybees.                                     schemes that prevent bus
                                                                                                                                                                  by automatic number
risk from terrorism                                                                       driver fatigue                                                          plate recognition
and further help us to      We will also introduce a rain garden at Joe Strummer subway                                                                           cameras and non-
achieve our Healthy         in Westminster, which will help create more sustainable                                                                               compliant HGVs will be
Streets ambitions.          urban drainage. We will continue planting along West                                                                                  issued with a penalty
                            Cromwell Road and identify new locations for ‘pocket parks’                                                                           charge of £550 per day.
                            across London.

                                                                                                                                                       Transport for London Budget 2020/21    25
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