Budget 2020/21 Contents

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Budget 2020/21 Contents 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 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 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 funding certainty from the oversee the running of TfL as I move on Extension to Nine Elms and Battersea 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 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. long-term funding certainty subdued economy, uncertainty around 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.
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