TfL ‘likely to get funding deal within days to stop going bust’

Transport for London says it is “likely” that a long-term funding deal will be struck with the Government within days that will avert the risk of TfL effectively declaring itself bankrupt and dramatically curtailing services.

TfL’s most recent deal ran out last Wednesday and it has been unwilling to agree to the new terms offered by the Department for Transport, which include almost £3.6 billion of capital funding for infrastructure projects and maintenance over the next two years.

TfL commissioner Andy Byford told an emergency meeting of its board last night this was because of concerns over the total money on offer — TfL is also seeking around £900million in day-to-day funding until the end of next March — and the conditions attached.

Mayor Sadiq Khan, who chairs the board, said: “It’s extremely disappointing we have not reached a conclusion yet. It’s not through the want of trying, I hasten to add, on the part of TfL.

“Some of the conditions we are unable to accept. They are not political in nature, but they add significant operational issues, and issues of principle that we simply can’t agree to.”

If TfL is unable to set a balanced budget, it is required to issue a “Section 114” notice that prevents spending on loss-making services. This “nuclear option” could potentially force the closure of part of the Tube and bus network.

TfL’s chief finance officer Patrick Doig said the “constructive conversations” with the DfT meant the need to issue a S114 notice was “not currently in place”. He warned the situation could change if talks collapsed but said a funding deal was the “likely outcome”.

Nick Rogers, Tory transport spokesman on the London Assembly, said the Mayor “needs to face facts about TfL’s finances.”