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The Mayor's announcement today of substantial increases in public transport fares and the congestion charge will be genuinely painful for public transport users.
But the move is the result of the combined effects of the recession and the collapse of the Metronet consortium. Boris Johnson is being open about the financial constraints.
Crucially, he has kept the main parts of the investment programme in transport infrastructure. Nevertheless, significant problems may lie ahead.
The overall, enormous increase in bus fares, of nearly 13 per cent, and of almost four per cent in Tube fares, is offset in part by ring-fencing concessionary fares.
But that value judgment is open to question. In good times, it may be justified to allow students free Tube travel but is it affordable now? And is air-conditioning on the Tube worth higher fares? Yet, while the overall increase is large, given the scale of the recession, it could have been worse.
Car-users will complain about the increase in the congestion charge to £10 a day, or £9 a day with the new automatic account system but this is the first increase since 2005.
The bigger problem is how far this package meets Transport for London's deficit. TfL predicts a £1.3 billion budget shortfall over the next three years. It will gain £125 million next year from fare increases but lose a net £35 million on the C-charge, because of the Mayor's plan to scrap the Western Extension.
He should consider whether it could be retained for peak-time travel.
Whether the remaining annual shortfall of £340 million can be met by trimming Tube upgrades is unclear.
More serious is the threat from central government. At present London's buses are subsidised by more than £600 million a year. It may be that Mr Johnson's show of willingness to make cuts will save this sum.
Then again, any government led by David Cameron and George Osborne may not feel they owe London's defiantly offmessage Mayor many favours. They seem not to recognise that London is the engine for the entire economy.
Likewise, TfL is haggling over £1.3 billion in projected Tube work costs with the remaining contractor, Tube Lines.
If the Public Private Partnership's arbiter rules in the contractor's favour, or if he does not and Tube Lines collapses, no one should count on central government picking up the tab.
Mr Johnson is making the best of the poor hand he has been dealt by recession and Gordon Brown's PPP scheme.
He is right to press ahead with investment for the future, though some of his spending choices are debatable.
We can only hope that whoever forms the next government will realise that holding back investment would be short-sighted, both for London and the entire UK economy.
The low moral ground
Unfortunately for MPs hoping for public sympathy because Sir Thomas Legg, who is investigating their expenses, is requiring some to repay excessive gardening and cleaning costs, it is starting to look as if he has not gone far enough.
The revelation that a Tory MP, David Wilshire, used Commons expenses to pay £100,000 into his own company, for which accounts were never filed, is a salutary reminder of the way in which MPs behaved under a system of self-regulation.
MPs whose letters from Sir Thomas were incorrectly based are entitled to feel aggrieved but it is arguable that the inquiry should have covered claims for excessive mortgage payments and flipping even if this means applying robust standards retrospectively.
Meanwhile, Harriet Harman, Labour's deputy leader, is said to be playing politics with the issue by saying one thing in public and another to MPs.
The original expenses scandal looked bad; the backlash looks no better.
Reader views (3)
school children take up sixty percent of bus seats for free, I pay and can not seat down. most of the school children on my route only travel between two to four stops. they should pay a set rate per day. why should I pay for thier transport. So Boris you say this is not a decision that you have taken lightly, but I think you have.
P.C half of the people who travel on bendy buses do not pay, again bendy buses are free for most.(sort out) If everyone paid a fare share,there will be no need for these price rises at all.
- Arsenal- London, London, 16/10/2009 08:26
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its a real shame that the price hike happens very year and since last year it has gone up too much. with more often tube strikes happening and with inappropriate tube services on weekend it would really difficult for one to travel who is on minimum wages an hour.
i normally work 7 days a week so i can make some money during this recession and i really struggle on weekends travelling to central london where jubilee n metropolitan line is always suspended. what's the point in having 7day tube pass where i cannot avail facility and have to struggle.
Rather than increasing price boris should look into matter where people take advantage of unfair council benefits and other stuff
real shame on boris
wish he was not a mayor
- Errick, london,uk, 15/10/2009 21:11
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If Boris isn't immediately scrapping his plans for a new Routemaster and reversing his decision to withdraw bendy buses at an annual cost of £20m then he's not making the best of a poor hand at all, he's making us pay for the consequences of his inability to formulate an effective transport policy.
- Tom, London, UK, 15/10/2009 09:43
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