Transport for London Budget 2018/19

Board Date: 20 March 2018 Item: Draft TfL Budget 2018/19 This paper will be considered in public 1 Summary 1.1 This paper seeks the approval of the draft TfL Budget 2018/19. 1.2 The members of the Finance Committee informally reviewed the financial summaries and analysis on 5 March 2018. 2 Recommendations 2.1 The Board is asked to: (a) approve the draft TfL Budget 2018/19; and (b) delegate to the Acting Chief Finance Officer the authority to make any editorial or other minor changes prior to its publication. 3 Background 3.1 The draft Budget 2018/19 sets out in detail the strategies outlined in the December 2017 Business Plan to deliver the Mayor’s plans for improving transport and reducing our operating costs in the financial year beginning 1 April 2018. 3.2 The document highlights the programmes and milestones that will see the most significant developments or progress over the next year. 3.3 The financial schedules, scorecard measures and key performance indicators are based on the forecast outturn position for 2017/18 as at period 11. List of appendices to this report: Appendix 1: Draft TfL Budget 2018/19 List of background papers: None Contact Officer: Simon Kilonback, Managing Director Finance (Chief Finance Officer) Number: 020 3054 8941 Email: [email protected] Document title over one or two lines TransportWith the possibility offor a sub-heading London running Budgetover one or two 2018/19 lines Draft Draft Draft About Transport for London (TfL) Contents Part of the Greater London Authority We are moving ahead with many of family led by Mayor of London Sadiq London’s most significant infrastructure Khan, we are the integrated transport projects, using transport to unlock authority responsible for delivering the growth. We are working with partners Mayor’s aims for transport. on major projects like Crossrail 2 and the Bakerloo line extension that will deliver We have a key role in shaping what the new homes and jobs London and life is like in London, helping to realise the UK need. We are in the final phases 4 Commissioner’s foreword 30 Underground the Mayor’s vision for a ‘City for All of completing the Elizabeth line which, Londoners’. We are committed to when it opens, will add 10 per cent to 6 Our scorecard 36 Elizabeth line creating a fairer, greener, healthier London’s rail capacity. and more prosperous city. The Mayor’s Transport Strategy sets a target for Supporting the delivery of high-density, 10 Budget at a glance 40 Buses 80 per cent of all journeys to be made mixed-use developments that are on foot, by cycle or using public planned around active and sustainable transport by 2041. To make this a reality, travel will ensure that London’s growth 12 Financial summary 46 Rail we prioritise health and the quality of is good growth. We also use our own people’s experience in everything we do. land to provide thousands of new affordable homes and our own supply 16 Debt and cash 52 Streets We manage the city’s red route strategic chain creates tens of thousands of jobs roads and, through collaboration with and apprenticeships across the country. the London boroughs, can help shape 18 Approach to forecasting 60 Other operations the character of all London’s streets. We are committed to being an employer These are the places where Londoners that is fully representative of the travel, work, shop and socialise. community we serve, where everyone 20 Financial trends 66 Commercial development Making them places for people to walk, can realise their potential. Our aim is cycle and spend time will reduce car to be a fully inclusive employer, valuing 22 Operational trends 70 Capital investment dependency and improve air quality, and celebrating the diversity of our revitalise town centres, boost businesses workforce to improve services for all and connect communities. Londoners. 26 Customer focus 74 Appendices We run most of London’s public We are constantly working to improve transport services, including the the city for everyone. This means London Underground, London Buses, freezing fares so everyone can afford the Docklands Light Railway, London to use public transport, using data and Overground, TfL Rail, London Trams, technology to make services intuitive London River Services, London Dial-a- and easy to use, and doing all we can Ride, Victoria Coach Station, Santander to make streets and transport services Cycles and the Emirates Air Line. The accessible to all. We reinvest every quality and accessibility of these penny of our income to continually services is fundamental to Londoners’ improve transport networks for the quality of life. By improving and people who use them every day. expanding public transport, we can make people’s lives easier and increase the None of this would be possible without appeal of sustainable travel over private the support of boroughs, communities car use. and other partners who we work with to improve our services. We all need to pull together to deliver the Mayor’s Transport Strategy; by doing so we can create a better city as London grows. Transport for London Budget 3 Draft Draft Commissioner’s foreword All our investment decisions are based on delivering the Mayor’s Transport Strategy. The Mayor’s Transport Strategy has to our network of Quietways and Cycle This has helped us manage some of now been formally presented to the Superhighways. the headwinds we have faced from the London Assembly, after extensive public removal of the grant and lower than consultation. At the centre of this On the Tube, we plan to place an order forecast revenue. strategy is a bold vision for 80 per cent of for new trains on the Piccadilly line, and journeys to be made by walking, cycling begin switching on the first sections of We will continue this focus on cost and and public transport by 2041. the new automatic signalling system revenue in 2018/19 as we modernise our on the Circle, District, Hammersmith & business. This will put us on the way to As we work towards that goal, we will City and Metropolitan lines, which will generating an operating surplus for the make travel healthier, easier and more first improve reliability and then the first time in our history by 2021/22. affordable for everyone in London. frequency of train services. We will use our own land to create This Budget also reflects what we thousands of affordable homes and Next year we will bring land to market believe to be cautious income forecasts dozens of new developments. By that will deliver more than 3,000 given recent trends. Just like any other delivering new infrastructure, we will new homes, including a significant business, we will proactively manage any support thousands of jobs and bolster opportunity in Morden where we are variance to forecast. the city’s economic growth. working in partnership with the London Borough of Merton. This adds to the There are consequences from losing Our Business Plan, approved in 3,500 homes we have already brought to more than £700m a year in operational December 2017, sets out a fully funded market. We are committed to ensuring grant funding in the Government's 2015 five-year plan for delivering that strategy. that will take the most dangerous that 50 per cent of the homes built Spending Review. Despite driving record This 2018/19 Budget explains in detail what vehicles off our roads by 2020. across our portfolio will be affordable. efficiencies, we have had to suspend we will achieve in the first year of the our programme of proactive road Business Plan. Making London an even more attractive Government grant funding for the cost maintenance on both borough and our place in which to do business, to live and of operating London's transport network roads. We will continue to ensure our Safety is our top priority. This year, we to visit is also a core priority. The first has reduced significantly. From 2018/19, it routine road maintenance keeps them are again setting ourselves challenging section of the Elizabeth line will open will be more than £846m per year lower safe. It cannot be right that London is targets for reducing the number of through central London in December, than it was in 2015. denied access to the dedicated road injuries among our customers, staff and we intend to begin the first phase of funding that the rest of the country and suppliers. transforming Oxford Street, which will To help address this, the first thing I enjoys and we will continue to make the make the area a world-class space for did when I became Commissioner was case to Government to correct it. Every injury is unacceptable, and we are residents and visitors. initiate a wholesale review of our cost committed to the Vision Zero approach base and how we are organised. This in the Mayor’s Transport Strategy, which Londoners will see real evidence of management focus has produced real seeks to remove all death and serious the Healthy Streets Approach in action, results and, in 2016/17, we reduced our injury across all transport in London. with record levels of investment in the operating costs by £153m. We expect to This year we will, among other things, boroughs, major new street schemes reduce like-for-like costs again this year, begin to bring in new safety requirements beginning across the city, including in Old with operating costs £200m lower in bus contracts and introduce a Direct Street and at Walthamstow gyratory, new than Budget.

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