Mind the gap
By Bob Pinkett, Partner – Transport
In a year of headline-grabbing pledges and promises in politics in the UK and around the world, the new London Mayor’s commitment to no fare increases for four years certainly resonated with voters, but has transport planners scratching their heads.
The election of Sadiq Khan last week reopens the debate about the transport system we want and the one we can afford. While other urban areas in Britain seek to emulate the success of London's public transport offer, usually with a lot less money, the Government believes that a strong mayor leading on transport is the model to follow. Hence the push for devolution, new city mayors and even the prospect of London-style franchising being brought in to other UK cities with the soon to be published Buses Bill.
Khan’s manifesto pledge to hold fares sits uncomfortably against his continued support for major rail and tube investment, as well as a continuation of the Boris cycling revolution. He believes the sums will be squared through attacking vanity projects – the new mayor has long complained about the New Bus for London, aka the “Borismaster” – and by achieving efficiencies in TfL, by reducing staffing (and consultancy support). Interestingly, Sadiq Khan also sees new revenue streams with TfL emulating the continental state-owned transport operators who sell their expertise worldwide and operate urban systems well beyond their boundaries.
What many voters may not know is that TfL’s budgets are already entering a significant austerity era, with national funding being reined in by the Treasury. Whatever the mayor wants to do, whether on fares or investment, will ultimately be framed by George Osborne’s actions and decisions. While Boris Johnson saw unprecedented growth in direct government funding, whether for the headline capital projects such as Crossrail or cycling superhighways, his successor will have no latitude in working with a much-reduced revenue budget (and where capital projects are only funded where development pays its way).
Even with ordinary annual inflation increases, TfL and London's politicians would have been faced with hard choices on local bus services, investments by boroughs in local highways, walking and cycling or bringing more of London's railways under the Overground brand. It is time that there is a grown-up conversation about how much it costs to have a world-class transport system, in what is, after all, one of the “world cities” that others look up to.
When passengers in London are asked about their transport priorities, a gut feel response is usually around the cost of travel, but drill down beyond the rhetoric and it is reliability, frequency, convenience and quality that users want – which requires investment so that a fair price can be charged. If fares do not keep in line with inflation and the costs of operating our transport system, we are more likely to see an erosion of services – after all, we don't need to cut fares to encourage users back onto London's popular and often already overcrowded public transport system.
We shall soon see if the new mayor finds out that the realities of balancing the books on our capital's transport is best served by a popular manifesto pledge or by carefully managing both revenue and investment in more transparent way that allows Londoners to understand the fine balance that is needed to grow the system to meet new and existing demands.