Five Billion Savings TfL Business Plan 2009-2018

MQT on 2009-11-18
Session date: 
November 18, 2009
Question By: 
Valerie Shawcross
Labour Group
Asked Of: 
The Mayor


Please explain for the record in detail how £5bn savings are to be made from the TfL budget over the current business plan period. How much has already been saved towards this target and where was this money found?


Answer for Five Billion Savings TfL Business Plan 2009-2018

Answer for Five Billion Savings TfL Business Plan 2009-2018

Answered By: 
The Mayor

hank you, Val. I happened to see your piece last night; the TV coverage of what you said. Perhaps it was not fair to what you were saying but, clearly, there are going to be substantial savings in the TfL budget. I have already, with you before the Transport Committee, and various other occasions, gone through the areas where those savings are going to be found and I can repeat them. You say, 'Could I please explain on the record in detail'. If you want me to recite now and hoover up your time I am more than happy to do so but I suspect that you would not want me to do that. Yes? No? Do you want me to?

Valerie Shawcross (AM): You normally do.

Boris Johnson (Mayor of London): I will. I will. If you want me to.

Valerie Shawcross (AM): No, no, it is fine.

Boris Johnson (Mayor of London): OK. How long have you got?

Valerie Shawcross (AM): Can I --

Boris Johnson (Mayor of London): She wants details, she is going to get detail! There are going to be role reductions of about 1,000 back office and support roles in London Underground following the integration with Metronet, raising £570 million --

Darren Johnson (Chair): Let us bring Val in.

Valerie Shawcross (AM): Mr Mayor.

Boris Johnson (Mayor of London): -- several hundred roles are also being cut across TfL. Consultants and temporary staff reductions and the use of --

Darren Johnson (Chair): Right. Valerie --

Boris Johnson (Mayor of London): She is asking for a detailed answer. All I can say is phrase your questions to reflect what you really want.

Valerie Shawcross (AM): Mr Mayor, the question is about where is the £5 billion to be found because, in fact, you had not made a full account of that so we did do a detailed comparison of last year's business plan and this year's business plan and try to analyse where the big shifts had been after the £2.4 billion that you had found in the previous year which you have just started to reiterate.

One of the biggest shifts and one of the biggest changes and the one that worries me the most is the removal of £1.7 billion, over the nine years, of net bus subsidy. That is after the service gets the extra income as a result of the fare increases which are, obviously, going up retail price index (RPI) plus 2% per year. So this £1.7 billion cut in the bus subsidy. How are you going to decide which service --

Boris Johnson (Mayor of London): I cannot confirm that figure, Val. That figure is not one that I recognise or have before me. I do not know what you mean by a cut in the bus subsidy. I think the last time that we met on this subject I confirmed to you that we were going to be making sure that bus subsidy did not continue to rise. People will realise that bus subsidy has gone up from about £24 million in 2000 to well over £600 million at the moment. That is a subsidy by the taxpayer to run London from virtually zero to more than £600 million. That is a huge increase. It has been accompanied, of course, by a massive improvement in London buses and we want to preserve that.

As I said to you, when we discussed the fares package and the business plan, what I do not want to do is see a significant or appreciable reduction in London bus coverage because I think it has been a fantastic success and we need to support it. I have listened a lot to what you have said, Val, in the last 18 months. I believe passionately in supporting people through a first class bus service and I can assure you that the savings we intend to make will not be made, as I think you fear, by cutting bus services. They will be made by all the means that I have already enumerated, and more in a similar vein.

Valerie Shawcross (AM): The business plan last year showed, on page 71, that the net bus subsidy was going to be £6.26 billion over nine years. That was last year's ten year business plan. The current business plan that has just come out shows the net bus subsidy at £4.5 billion. There is a very clear reduction in the bus subsidy of £1.7 billion over that period of time. If you look at the other figures which are expressed in the business plan you can see that, clearly, there is a planned reduction in the bus service. For example, one of the strangest sets of figures is the massive reduction planned in bus passenger numbers. In fact there is a rapid deterioration between last year's projections and the current year's projections --

Boris Johnson (Mayor of London): Sorry. I think, for the benefit of people who cannot see Val's map --

Valerie Shawcross (AM): You cannot see my lovely graph. My lovely Blue Peter graph tells you --

Boris Johnson (Mayor of London): You can see that these are two lines going up at slightly different rates, rather than a reduction.

Darren Johnson (Chair): James [Cleverly] has just got a point of order.

Valerie Shawcross (AM): Can I just finish the question, please Mr Mayor? Chair, can I just finish the question?

Darren Johnson (Chair): James needs to come in with a point of order so very quickly, James.